Ethiopia has sought to enhance the participation of local investors in the country’s private sector – through the development of new policies and frameworks – in order to stimulate the industry, boost the economy, and drive socioeconomic development.
Various economists, such as trade and investment advisor Amanyhun Reda, and Managing Director at YHM Consulting, Yared Haile-Meskel, have noted that the government’s engagement would create a conducive environment for economic growth and provide an opportunity for local development.
“With regards to Ethiopia’s limited technological capacity, the development of local investors in the mining sector is the order of the day to enhance economic transformation,” Reda stated, adding that, “Knowledge and experience will be developed over time, not overnight, and higher education institutions have a big role to fill the skills gap in the sector.”
Reda noted that despite Ethiopia’s innumerable resources, the country has been unable to benefit from the mining sector due to limited local investment and expanding the role of local investors would lead to the development of a considerable number of jobs while simultaneously expanding the east-African country’s energy sources.
The government has sought to increase the mining sector’s contribution to its GDP by 10% by 2030 from its current 3%, moving to remove barriers that inhibit local investment, with specific focus placed on minerals such as potash, which is used in agriculture and construction, as opposed to those used in the artisanal industry.
Haile-Meskel noted that the country’s inability to develop and use its natural resources has prevented Ethiopia from developing the foundation for overall development, highlighting that large-scale domestic investment has the potential to drive industrialization in the country.